Increasing Financial Awareness Amongst Youth in Turkey

What is the project about?

The project aims to increase the financial management capabilities of young people in Turkey. A contemporary, non-formal training curriculum on budgeting and financial management will be established and multiplied among young people in Turkey via local youth councils in cities of Turkey using a peer education model and e-learning tools. The project will serve for the socio-economic empowerment of youth and will significantly contribute to the implementation and realization of UN Youth Policies as well as MDGs.

What has been the situation?

Half of Turkey’s population is under 28 years of age, representing almost 35 million people. This demographic profile combined with information on employability and income suggests that Turkey’s youth, especially those in the country’s less developed regions, do not enjoy the same financial and intellectual opportunities available to their peers in other countries. Social and economic disparities have their effects on the quality of life of the young men and women. Factors such as the low levels and quality of education, lack of equal access to education (especially among young women), high and rising youth unemployment figures, high prevalence of violence amongst and against the youth are some serious causes for concern. Most importantly, these issues will cause long-term development challenges for Turkey if they are not addressed.

Scarce socio-economic opportunities provided for young people are further limited due to the inadequate knowledge of budgeting and financial management skills. Young people rarely make a financial plan nor balance their income and spending to secure their financial future.

The general population of Turkey and especially its young men and women, lack viable information to make wise investment decisions such as how one calculates their disposable income; makes a short-term and long-term financial budget; files their taxes or simply understand basic economic and financial terminology. They also lack knowledge on how to use financial investment tools which could end up with a young population undertaking risky financial decisions.

An important issue which has also attracted a lot of attention in light of the recent global economic environment is the national personal savings rates. The personal savings rate (PSD) is defined as disposable income less consumption expenditures, all divided by disposable income – meaning that a negative PSD means that the individual is spending more than there income after taxes.

When macro-economic data on Turkey is analyzed, it is observed that due to the insufficiency of the savings, the major part of consumption is made through the use of foreign sources. In the last couple of years, attractive credit and installment opportunities have encouraged unsound spending decision made by the Turkish households. Considering that the new economic boom environment that has formed after the 2001 crisis, the consumption as well as going into debt has increased tremendously in Turkey. Based on the data provided by the Bank Regulation Committee, Turkish households are indebted by 25% of their income. Moreover, based on the Turkish Statistical Institute data, the estimated personal savings rate of Turkey fell under %12 levels in the years 2005 and 2006 (compared with the last 20 year average of %16.7) and is now around 14.3%. On the other hand, the average the national (both public and private) savings rate is around %17. When this figure is compared with the world average (upward trend of %23,8 in 2008), with the developing Asian countries’ average (%44,7) and with the Middle Eastern petrol-rich countries’ average (increased from %25-27 levels to almost 50% level in 2008), it is seen that the savings rate in Turkey is very low.

Economic experts specifically points out that the personal sector savings rate is below the average among the developing countries and indicate that this level creates vulnerabilities in the economy. They all agree that for a more sustainable economy, the personal saving rates should increase.

As in some country cases, having large and wide-spread negative personal savings rates can be detrimental to a county’s economy. To teach the young men and women in Turkey, who will be tomorrow’s leaders and managers, how to make sound personal investment decisions, would have a positive impact on the Turkish economy for the years to come.

According to the UN’s Common Country Assessment (CCA) for 2006-2010, the Turkish young men and women are rarely trained in the basic ‘life skills’ or provided with accurate information. Skills-based education topics are not covered in the mainstream education curriculum or addressed by parents. However, it is essential that children and youth be empowered and equipped with new knowledge and life skills, which would also assist the government in reducing constraints on the national social and health systems. Investing in children and the youth would promote their healthy development and support economic and social progress. For these reasons it is deemed essential to inform children and young men and women of their rights, give them access to information and educational services, and promote a gender equitable, protective and enabling environment. They should be able to participate in the empowering social and economic processes and realize their potential as agents for social change.

Through the Local Agenda 21 Programme, the United Nations Development Programme (UNDP) and the Youth Association for Habitat are engaged in addressing many of the challenges facing Turkey’s young men and women. In response to the global mandate, as contained in Chapter 28 of Agenda 21, the Local Agenda 21 (LA21) Program was launched in 1997 in Turkey under the auspices of the UNDP and coordinated by United Cities and Local Governments - Middle East and West Asia Section. Within the scope of the LA21 program, local youth platforms have been established throughout the country with the coordination of the Youth Association for Habitat (YfH). These efforts encompassed the establishment of local youth councils and youth centers. Local Youth Councils bring representatives of youth NGOs, as well as students and employed and unemployed young men and women together at provincial level. These platforms raise awareness on youth related issues, encourage young men and women participation in decision-making, and create an inclusive platform for people of different backgrounds to come together, share common values, and identify solutions to shared concerns.

The youth component of the LA21 program manifests an outstanding performance in terms of mobilizing the young men and women at local, regional and national levels. Local youth councils have established a nationwide network and have started to come together in regional and national programs. They have been in close interaction with the youth throughout the world in various occasions, raising the profile of Turkey’s youth.

The efforts of local youth platforms have been directed towards addressing development challenges including the promotion of key principles and values. These platforms have been a motivation to achieve individual capacity building and mobilize young men and women for increased social responsibility and improvement of the quality of life in the cities, sustainability and governance.

Moreover, Paragraph (f) of Chapter 25 of Agenda 21 globally urges UN member states to “establish task forces that include youth and youth non-governmental organizations to develop educational and awareness programs specifically targeted to the youth population on critical issues pertaining to them. These task forces should use formal and non-formal educational methods to reach a maximum audience. National and local media, non-governmental organizations, businesses and other organizations should assist in these task forces”.

What is our mission?

The Project aims to increase the financial management capabilities of young people in Turkey. A contemporary, non-formal training curriculum on budgeting and financial management will be established and multiplied among young people in Turkey via local youth councils in 15 cities using a peer education model and e-learning tools. The project will serve for the socio - economic empowerment of youth and will significantly contribute to the implementation and realization of UN Youth Policies as well as UN Millennium Development Goals.

How are we doing this?

Project partners, working with an expert on financial management, will prepare a training curriculum of the project. The curriculum will cover trainings on budgeting; financial-planning and management; personalizing credit cards; loans; good credit standing; the effects of financial awareness on sustainable development. The know-how of VISA Europe and its member banks will be utilized at developing and providing project trainings.

Members from the Training and Coordination Group of the National Youth Parliament and representatives of 15 local youth council will receive trainers’ trainings on Hence, the project will establish a task force composed of 60 young volunteers on financial awareness. 60 volunteer trainers of the project will be selected from local youth councils in project cities; 50% 50% gender equality will be granted among volunteer trainers who will be university graduates or students and who will be able to present good level of communication and presentation skills. The project will be implemented in 15 cities from each 7 geographical region in the country:

Marmara Region: İstanbul, Bursa, Kocaeli

Black Sea Region: Trabzon, Samsun

Central Anatolia Region: Eskişehir, Ankara

Mediterranean Region: Antalya, Adana

Aegean Region: İzmir, Denizli

East Anatolian Region: Erzurum, Malatya

South East Anatolian Region: Gaziantep, Diyarbakır

Above listed cities are mainly metropolitan regions where youth population is comparatively higher than other cities in the given geographical region. The task force of the project will be responsible for raising awareness on securing financial well-being amongst local communities, providing trainings on financial management for the members of their own local youth councils, which cover high schools and university students, members and target groups of youth NGOs, and unorganized youth. The task force will also be responsible for advocating the concerned subject matter at national and local media, non-governmental organizations, local governments, businesses and other organizations.
Furthermore, the www.paraniyonet.com website of VISA Europe and thewww.ulusalgenclikparlamentosu.net web portal of the National Youth Parliament will be the focal online training mechanisms of the project. Online training curriculum and simulation games on financial management will be used to increase awareness.

The project will provide trainings to 6,000 young people from project cities. The target group of the project will be composed of young people between the ages of 15 and 30. 50% 50% gender equality will be granted among the trainees of the project. Besides, the target group will be categorized into three sub-groups; the first sub-group will include young people at the ages of 15 and 18, the second sub-group will include young people between 18 and 30 years old who are students and the third sub-group will include young people between 18 and 30 years old who are employees.

60,000 people will be informed by the project through the website and awareness building activities conducted in the Universities and other local civic platforms. The impact analysis of the project will be realized via pre and post tests. The outcome of the project and the results of the impact analysis will be provided to the government as a policy recommendation on financial awareness. Gender equality consideration will be assured throughout policy formation.

How will Turkey benefit?

The primary direct beneficiaries of the project will be socio-economically young people in Turkey below 30 years of age. This Project aims to empower 1.000.000 young people on ICTs within three years.

By the end of the first year of the project, the Project targets to reach 50 thousand young people through the Local Agenda 21 youth platforms and another 50 thousand high school students through the Ministry of Education.

For the second and third year of the project, this Project will be the biggest ICT Literacy project in the country as the number of trained young people will be multiplied reaching out 1.000.000 by the end of 2009.

The Project will not only increase the digital inclusion of 1.000.000 Turkish youth via increasing their ICT capacities through online ECDL training , but it will also fulfill the need for ICT skilled employees in Turkey.